The Hagerty Market Rating measures the current status of the collector car market in terms of activity or “heat,” directional momentum, and the underlying strength of the market. It is expressed as a closed 0-100 number with a corresponding open-ended index (like the DJIA or NASDAQ Composite). To learn more about how we calculate the Hagerty Market Rating, read here.
For three months in a row, the Hagerty Market Rating has been dipping further and further below 60. After a 0.17-point drop, the current value of 59.6 is the lowest it has been in five years. While the eye of the collector car world was focused on the Monterey Auctions last week, the Ferrari-filled results won’t enter the Market Rating calculation until next month.
The Hagerty Market Index, an open-ended stock market-style version of the Market Rating, has dropped for 13 of the last 14 months to its lowest point in three-and-a-half years. The current value of 173.16 is still relatively high compared to it’s 18-year history, but it has dropped 16 percent since its peak less than three years ago.
Even though the Monterey numbers won’t effect the Market Rating until next month, we can take a look at how the top-end of the market, and auctions in general, have been performing.
Heading into Monterey, the Overall Auction Activity metric has dropped five months in a row. While the count of cars sold has remained relatively high, the overall metric was dragged down again by the median sales price, which is on a 28-month losing streak. The current median sale price of just over $27k is the lowest this metric has been since the start of the Covid pandemic in May 2020, when all live auctions were canceled. However, when adjusted for inflation, the median sale price is the lowest we’ve seen in the history of the Market Rating. The multitude of seven and eight-figure sales at the Monterey auctions will likely boost this metric next month.
For vehicles with insured values over $250,000, Hagerty receives 1.39 requests from clients to increase the insured value for every call to decrease the value. This ratio has settled at a new low-water mark, having dropped below 1.4-to-1 for only the ninth time in the metric’s 16-year history. For less expensive vehicles, this ratio has dropped 11 of the last 12 months and is at its lowest value since fall 2021, but the ratio of insured value increases-to-decreases for these vehicles is still 6.46-to-1.
Values for high-end vehicles in the Hagerty Price Guide continue to fall. The Hagerty Blue Chip Index, which is comprised of the average #2 (excellent) condition value of 25 seven-figure cars, has dropped to its lowest value in nearly 12 years.
Of the 14 individual metrics in the Market Rating, only two increased this month. Our macro economic indicator was propped up solely by the S&P500, with the price of gold, median home price, and retail sales all taking a dive. The other increase we saw was the average opinion from our classic car market experts, which moved up a third of a point this month.
Expert sentiment heading into the Monterey Auctions hit 51, the highest it’s been since the start of the year. Still, the group’s average score of the classic car market has hovered between 48 and 51 for the past 11 months. Dave Kinney, Publisher of the Hagerty Price Guide, sums up their uncertainty. “The current state of the high-end market will be observed at the upcoming Monterey auctions. That said, the lower end of the market remains a tick above stagnant, with little indication of direction. Is the overall economic downturn (promised for the past three years!) finally here? Will there be a pivot to collectibles that helps our market, as there has been in the past?” I’m sure their opinions will be stronger after digesting the Monterey results.
Next month, the Monterey Auctions’ numbers will hit the Hagerty Market Rating. With an average sale of $524,486 and $432.8M in total sales, both the highest since 2022, there is a good chance that the Market Rating will see a slight uptick. Enough to push it back into the 60’s? We’ll have to wait and see.
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